An unfinished legal battle between gas utility DEPA and ELFE (Hellenic Fertilizers and Chemicals), recently vindicated by an Athens Court of First Instance verdict calling for a 63 million-euro return from the gas utility for gas supply overcharging, threatens to block the launch of a privatization offering 65 percent of DEPA Trade, a new DEPA entity established for the privatization, despite strong investor interest.
The Court of First Instance decision in favor of ELFE, delivered four months ago, is a major blow for DEPA’s finances as the sum could potentially balloon if other firms follow the example set by ELFE and also take legal action, authorities have stressed.
The court ruled that DEPA overcharged ELFE between 2010 and 2015 by applying an oil-indexed gas pricing formula used by Russia’s Gazprom.
DEPA is expected to win an appeal as the utility is backed by a strong case, sector experts have pointed out.
If, however, ELFE ultimately proves these predictions wrong and wins the case then other companies supplied by DEPA, including electricity producers, would be prompted to take legal action of their own against the utility, taking advantage of the legal precedent. This would require DEPA to return sums worth hundreds of millions of euros, in addition to the ELFE amount.
Subsequently, the DEPA Trade sale cannot proceed with such ambiguity hanging in the air as prospective bidders will simply not turn up and submit binding bids if all is not clear.
A public prosecutor at a Court of First Instance is investigating the main power utility PPC over suspicions that it could be selling electricity at unfair, below-cost prices to its two biggest energy-intensive industrial consumers, the troubled state-controlled nickel producer Larco and Aluminium of Greece, cross-examined information has indicated.
It is believed PPC has been asked to present a series of financial details in a letter forwarded by a financial police authority, which notes, in the letter, that a preliminary investigation is being held based on a Court of First Instance order.
Documents demanded by the financial police authority include financial statements such as balance sheets and financial results from 2013 to 2017, invoices concerning transactions with energy-intensive customers from 2013 to the present, as well as price and supply agreements signed by PPC with Larco and Aluminium of Greece from 2013 to now.
The letter received by PPC does not explain what prompted the investigation, nor does it clarify its purpose, but it is firmly believed PPC’s electricity supply prices offered to Larco and Aluminium of Greece are the concern.
EVIKEN, the Association of Industrial Energy Consumers, recently contended PPC’s electricity supply pricing policy for Larco and Aluminium of Greece and the duration of these agreements are favorable, adding other industrial consumers need to counter demands such as higher CO2 emission right price, end of discount offers, and brief one-year supply agreements.
The association’s claims were made following the launch of the public prosecutor’s investigation.